Over the last decade, employment and staff dynamics has witnessed a lot of change. Aside from a change in the relationship shared by employers and their employees, there has been a change in the way people work- home based workers, contract employees, mobile employees, the options are many. All this means employers have to change their regulations and system; one such change is employee reimbursement, which forms an important part of bookkeeping for small business. All expenses incurred to run your business are business expenses, so all expenses incurred by your employees in order to help run your business are expenses and hence should be compensated. Communication, transportation, internet are examples of employee business expenses. If you cannot provide for all these, you should clearly define what expenses you will reimburse. Let us take a look at some common employee expenses that are reimbursed in bookkeeping for small business.
- Company Travel– Some jobs demand frequently travelling to meet clients, attend conferences or meetings. All expenses that are incurred by the employee when away from home are travel expenses and have to be considered for employee reimbursement. As an employer, it is your responsibility to clearly list what expenses will be covered under this for bookkeeping for small business, for example, lodging, food, transportation etc, and what won’t.
- Insurance– Liability, malpractice and vehicle insurance are few types of insurance that are necessary for certain jobs. If any insurance is needed as part of the job, the company should make provisions for reimbursing the expenses when bookkeeping for small business.
- Communication– Employees today can work from home or work on the go. They will however have to be connected to their employers and team; the expenses incurred in this respect are referred to as communication expenses. Telephone charges and internet costs are generally covered in this. Make sure you think through your communication reimbursement policy and list it clearly for employees.
- Other Types of Reimbursement– We live in a competitive world, whether you are an employee or an employer. As an employer, it is important that you have some form of employee reimbursement in place to retain employees. This can include technology upgrades and incentive plans. To attract and retain good and loyal employees, you have to be able to anticipate their needs and meet them.